Mediation for the last, and potentially one of the biggest, settlements in Detroit's historic bankruptcy case has moved to New York City, a Detroit spokesman said yesterday, amid a newspaper report that a potential deal with Financial Guaranty Insurance Co. (FGIC) is still days away, Reuters reported yesterday. Bond insurer FGIC is the last major objector to the largest-ever municipal bankruptcy, with $1.1 billion on the line from guaranteeing payments on city pension debt. Nearly a month ago, Detroit struck a deal with another bond insurer, Syncora Guarantee Inc., which included a financial recovery of 13.7 cents on the dollar and a bevy of real estate transactions encompassing a central parking garage, development options and a lease for part of a tunnel connecting the city to Canada. The city's lawyers have emphasized at the ongoing hearing that a settlement similar to Syncora's is available to FGIC. Court-ordered mediation on a possible settlement has moved to New York at the request of Judge Gerald Rosen, who is leading mediation efforts in the case, said Bill Nowling, spokesman for Detroit emergency manager Kevyn Orr, who is participating by telephone. Nowling added that the situation remains fluid and no deal has been reached.
